In the current market landscape, when equities are at record high, you may be reluctant to invest in mutual funds considering that you may get lower number of units as NAVs for most of the funds are rising in tandem with the markets. Nevertheless, mutual fund investment over a longer term via the SIP route ensures that you average out the cost. Furthermore, long term investment also helps to mitigate any significant downside at any point in time.
So, considering the long term view of fund returns, here we lists out the top rated and top performing flexi cap schemes based on 5-year returns that you can consider for investment.
Flexi-cap schemes could be looked upon by aggresive investor class seeking flexibility in terms of investment across market caps
Introduced lately, Flexi-cap mutual fund schemes are most suited for investors with an investment time horizon of at least 5 years or more and aiming flexibility in terms of ownership of companies across market capitalizations. Notably, the schemes falling under the flexi-cap bucket need to mandatorily invest at least 65% of their corpus into equities. However, unlike the multi-cap funds, there is no cap with respect to allocation to any market cap.
Top rated and top performing equity-flexi cap funds based on 5-year annualised returns
|Flexi cap Fund||Rating||5-year Annualised returns (in %) Based on NAV as on August 17, 2021|
|Parag Parikh Flexi Cap Fund||Value Research and Morning Star 5-Star rated||20.8|
|PGIM India Flexi Cap Fund||CRISIL, Value Research and Morning Star 5-Star rated||18.87|
|UTI Flexi Cap Fund||CRISIL, Value Research and Morning Star 5-Star rated||17.5|
1. Parag Parikh Flexi Cap Fund:
Launched in the year 2013, Parag Parikh Flexi Cap Fund is a flexi cap fund from the stable of PPFAS Mutual Fund. The fund commands a sizeable fund size of 13,187 crore and expense ratio of 1.85%. Net asset value (NAV) of the fund as on is August 17 is 46.36. The fund is placed under the very high risk category.
The fund's investment universe is not restricted by any self-imposed limitations in terms of sector, market capitalisation, geography, etc. Nonetheless, an average of 65% of its corpus is deployed in listed Indian equities for benefitting from the favourable Capital Gains tax treatment accorded to such scheme.
Both Morning Star and Value Research have accorded the scheme a 5-Star Rating. The fund is benchmarked against Nifty 500 TRI. Total TER of the fund as on August 16 is 1.82%. Note both lump sum and SIP investment in the fund can be started for just Rs. 1000.
Top stocks in the fund's portfolio include Alphabet, Bajaj Holdings,, ITC, Microsoft, Facebook, Amazon and Persistent Systems among others.
2. PGIM India Flexi Cap Fund:
In existence since 2015, this flexi cap fund from the house of PGIM India mutual fund commands a decent asset size of Rs. 1689 crore. Expense ratio of the fund is 2.36% as on June 30, 2021..NAV of the fund as on August 17 is 25.53 for Regular-Growth plan.
Investors with a time horizon of more than 3 years can bet on the scheme for realizing long term goals such as child's education, marriage, retirement goals etc.
SIP in the fund can be kick-started with a minimum sum of Rs. 1000. Rs. 10,000 monthly SIP started 5 years hence i.e. a total investment of Rs. 6 lakh is now worth Rs. 11.22 lakh.
Top fund holdings include stocks like ICICI Bank, Infosys, Coforge, TCS, Ultratech among others.
3. UTI Flexi Cap Fund:
Formerly referred as UTI Equity Fund, this flexi cap fund commands a decent corpus of over Rs. 20,000 crore. Expense ratio of the fund is 2% as on June 30, 2021. It is one of the oldest fund from the oldest mutual fund house in the country that was launched in the year 1992 and since inception has given a return of over 13%. Last NAV of the fund is 247 as on August 17. The scheme's performance is benchmarked against Nifty 500 index.
Positioned as a multi cap fund, the flexi cap scheme of UTI comprises high quality businesses that have an ability to show strong growth for a long period of time. "Quality" companies perform across market cycles with a capability to mitigate drawdown and "rebound faster based on the strong fundamentals of balance sheets & business models. The Fund incorporates bottom up stock selection method with well defined metrics of free cash flows, capital efficiency and ability to compound earnings.
SIP in the fund can be initiated with an initial sum of just Rs. 500, while for lump sum investment you need to put in a minimum of Rs. 5000.
Top stock holdings of the fund include Bajaj Finance, HDFC Bank, L&T Infotech, Kotak Mahindra Bank and HDFC etc.
Note the mutual funds listed above are ranking higher in terms of performance over the last 5-years and hence can make a good investment choice if you are seeking flexibility in your investments. Nevertheless, this story piece should not be construed as investment advice.